Clearwater Analytics Holdings, Inc. (‘Clearwater’) provides a SaaS solution for automated investment data aggregation, reconciliation, accounting and reporting services to insurers, investment managers, corporations, institutional investors and government entities.
The company’s cloud-native software allows clients to radically simplify their investment accounting operations, enabling them to focus on higher-value business functions, such as asset allocation strategy and investment selection. T...
Clearwater Analytics Holdings, Inc. (‘Clearwater’) provides a SaaS solution for automated investment data aggregation, reconciliation, accounting and reporting services to insurers, investment managers, corporations, institutional investors and government entities.
The company’s cloud-native software allows clients to radically simplify their investment accounting operations, enabling them to focus on higher-value business functions, such as asset allocation strategy and investment selection. The company’s platform provides comprehensive accounting, data, and advanced analytics, as well as highly-configurable reporting for global investment assets daily or on-demand, instead of weekly or monthly. The company gives its clients confidence that they are making the most informed decisions about investment performance, regulatory compliance, and risk.
The company provides full investment lifecycle solutions spanning accounting and reporting, performance measurement, compliance monitoring, planning and order management, and risk analytics solutions for asset managers, insurance companies, large corporations, and other asset-owning institutions, including governments, endowments, and foundations. The company brings modern software to an industry that has long been dominated by difficult-to-use, high-cost legacy technologies and processes, which often lack data integrity and traceability, and often require significant manual intervention.
The company’s platform provides its clients with a single consolidated and transparent view of investment data and analytics, leaving the hard work to the Clearwater team of experts.
The company allows its clients to replace these legacy systems with modern cloud-native software. The company’s platform helps clients reduce cost, time, errors, and risk, and allows them to reallocate resources to other value-creating activities. The company’s software aggregates, reconciles, and validates data from more than 4,100 daily data feeds and more than four million securities that have been modeled across multiple currencies, asset classes, and countries. This cleansed and validated data runs through the company’s proprietary accounting, performance, compliance, and risk solutions to provide clients with powerful analytics and daily or on-demand configurable reporting. The company offers multi-asset class, multi-basis, multi-currency accounting and analytics that provide clients with a comprehensive view of their holdings and related performance. This allows the company’s clients to make better, more timely decisions about their investment portfolios.
Clearwater benefits from powerful network effects. With the company’s single instance, multi-tenant architecture, every client, whether new or existing, enriches its global data set by making it more complete and accurate. The company’s software continually sources, ingests, models, reconciles, and validates the terms, conditions, and features of every investment security held by all of its clients. This continuous process helps to create a single repository of comprehensive, accurate investment data (often referred to within the industry as a ‘Golden Copy’ of data) that benefits all its clients to the extent they otherwise have rights to the data. Through this continuous process, the company is able to identify and adjudicate data discrepancies that otherwise could introduce error and risk into its clients’ investment portfolios.
The company continues to expand its product offerings within its Core Clearwater solution and continues to introduce new, adjacent solutions to its clients, including Prism, LPx, and, since 2023, MLx. In addition to the company’s organic multiproduct expansion, it acquired JUMP Technology in 2022. The JUMP solution provides Order Management and Portfolio Management solutions, as well as specific functionality tailored to the French market. In 2024, the company acquired Wilshire Technology to provide clients with additional post-trade risk capabilities.
The company has a recurring revenue model, excluding revenue from professional services and license-related revenue from JUMP. The company charges its clients a fee that is based on the amount and complexity of the assets they manage on its platform, as well as the breadth and type of the solution utilized by the client. In 2022, the company transitioned its contracting structure to a framework it describes as Base+ for all new clients. A Base+ contract framework includes a base fee for a prospective or existing client's book of business, plus an incremental fee for increases in assets on the platform. This structure is designed to limit the downside volatility in the company’s asset-based fees. The company also began to amend contracts with its existing clients to either modify the structure of such contracts from a pure asset-based fee to this Base+ model, or to increase the basis point price. Prior to 2022, the company charged a basis point fee based on the client’s assets on the platform, subject to contracted minimums. For those clients contracted prior to 2022 and whose contract has not been amended, its revenues can fluctuate more significantly with the changes in those clients’ assets. A majority of the assets on the company’s platform are high-grade fixed income assets, which have traditionally had lower levels of volatility, enabling its highly predictable revenue streams. The Base+ model includes annual increases in the base fee and enables the company to charge additional fees for supplemental services provided for certain alternative asset classes (e.g., LPx, MLx) or additional products (e.g., Prism, OMS/PMS) should the client choose to utilize those services.
Industry
The company serves the entire investment lifecycle and operates in the investment accounting and analytics market, serving a range of clients that own or manage investment assets.
Platform
The company’s purpose-built single instance, multi-tenant technology platform simplifies its clients’ investment management accounting and reporting, performance measurement, compliance monitoring, and risk analytics infrastructure and workflow. The company’s software automates data aggregation, data reconciliation, data validation, and trade management of each security in its clients’ investment portfolios. This creates a fully reconciled ‘Golden Copy’ of investment portfolio data, which can be trusted for accurate reporting, analytics, and action. The company’s clients benefit from having a comprehensive ‘single pane of glass’ view for daily visibility into all investment data and analytics. The company’s platform often allows clients to eliminate multiple legacy products and systems, as well as significant manual labor. Approximately 89% of portfolios are automatically validated, reconciled, and processed without further intervention. The remaining 11% of accounts are flagged for further analysis and reconciled by its reconciliation team.
In order to deliver these powerful solutions and benefits, the company purpose-built its technology stack to efficiently process millions of daily transactions in a highly scalable and efficient manner. The company’s platform is built on a single code base and eliminates the need for costly and time-consuming patches and upgrades across multiple, disparate software instances. As new features are developed and deployed, they are made available to all clients. The company’s system leverages the latest machine learning and artificial intelligence tools to ingest both structured and unstructured data that is transformed into a universal security model that enables network benefits for its clients.
The company’s clients access the platform through a web-based interface that is highly configurable and provides a set of tools that enable its clients to derive actionable insights on a daily basis. This allows the company’s clients to view their portfolio data from anywhere with an internet connection. The company’s intuitive, easy-to-use platform allows users to view high-level portfolio information and quickly drill into portfolio specifics down to the most granular security level. The company’s platform also creates automated feeds to other client systems—such as trade order management systems, data warehouses, enterprise resource planning (ERP) systems, and others—eliminating the need for clients to manually enter data from Clearwater’s solution into other client systems.
Solutions
The company’s solutions are offered through one unified Clearwater platform and are detailed below:
Investment Accounting and Reporting: The company’s accounting solution was built with the flexibility to offer operational and regulatory accounting, from the simple to the complex, on the same platform. The company’s solution is comprehensive in its capabilities:
Multi-asset class: The company has differentiated global asset class coverage, including fixed income, equities, bank loans, commercial and residential mortgages, private capital markets (e.g., general and limited partnerships), derivatives, and various other alternative assets;
Multi-basis: A single client can access 39 accounting bases, such as GAAP, Statutory, Tax, and IFRS. The company’s platform has the flexibility to add new accounting bases as its clients’ needs require; and
Multi-currency: The company supports clients with more than 54 local currencies (currency of the country they are domiciled in), 30 functional currencies (currency of the country where their principal business is), and numerous reporting currencies.
The company’s platform offers flexible configurations and outputs, customized general ledger entries for multiple accounting bases, and regulatory completeness. A suite of standardized reports automates relevant investment-related disclosures, such as Fair Value Hierarchy and Level 3 Roll-forward, and can be easily configured to provide the detailed accounting information investment accountants and internal stakeholders need. The company’s daily reconciliation, flexible reporting, and general ledger capabilities ensure that period-end close processes are efficient and accurate.
Performance Measurement: The company’s solution enables investors to compare separate accounts, set custom benchmarks, and track the overall performance of their portfolios. Custom performance reports and return calculations are available and designed to meet applicable GIPS calculation standards for investment managers.
Compliance Monitoring: The company’s users can set custom rules to monitor compliance according to their investment policies and standard applicable regulations. All investment activity is checked against those rules as often as a client requires and tracked at the security level.
Risk Analytics: The company offers insightful risk analytics to ensure investors have access to their portfolios’ exposure every day. The company’s risk monitoring solution provides access to critical financial and investment portfolio risk information, so users are able to quickly answer pressing risk-related questions, including exposures by issuer, currency, country, duration, credit rating, and more.
Clearwater Prism
The company’s Clearwater Prism solution is a modular, SaaS-based data and reporting platform for investment data. Built on a cloud-native stack, it enables data ingestion, transformation, and reporting across all asset classes. These capabilities are delivered using a range of product modules, namely Prism Reporting and Statements, Prism Connectors, Prism Data Ops, and Prism Managed Services.
Prism Reporting and Statements is a web-based client reporting and statement generation module that enables asset managers to create pixel-perfect client books and statements.
Prism Connectors is a set of ready-made adapters to vendor- and proprietary platforms to ingest investment-related information.
Prism DataOps is a data engineering platform that allows self-serve, user-defined data management, including maintaining data taxonomy, lineage, and transformation of investment-related information.
Prism Managed Services is a modular service that provides clients with professional support services for maintaining and extending their data feeds and reports.
The application of these modules extends into various use cases, including aggregating external data with accounting data generated by the Clearwater platform, enabling the efficient processing of private markets data using the Clearwater LPx and Clearwater LPx Clarity products to provide a deep and unparalleled level of transparency and connectivity with other data sets, such as ESG data.
Clearwater LPx:
Clearwater LPx is a full-service solution for private funds that delivers complete, timely, accurate, and consumable data for limited partnerships.
The solution empowers institutional investors to understand underlying risk and exposure data in limited partnership investments and empowers them to make informed decisions. With the solution, investment managers have confidence in their data and know they are accessing the most complete, accurate, and trusted information at their fingertips.
Clearwater LPx automates the aggregation and normalization of data for private assets and delivers clean, validated, and timely data through a single pane-of-glass view. LPx scans and interprets data buried in PDF files, cleans and surfaces them for comparison and reporting, and provides a complete view over LP investments not available anywhere else on the market.
Clearwater MLx:
Clearwater MLx is a comprehensive mortgage loan investment solution. Clearwater MLx addresses the limitations of legacy solutions by providing investment professionals with a comprehensive platform to drive growth and make informed decisions at every stage of the loan lifecycle, from origination and deal management to analytics, accounting, and reporting.
Clearwater MLx offers investors necessary oversight and reporting capabilities to effectively navigate the complete lifecycle of their mortgage loan investments. It also offers enhanced risk reporting, servicer tracking, oversight, and accounting so that investors have the capabilities they need to successfully manage and grow their mortgage loan portfolios.
Clearwater JUMP
The company acquired JUMP Technologies in November 2022 in furtherance of its growth strategy of expanding internationally and entering into adjacent markets, offering adjacent functionality for the ‘Full Investment Lifecycle’ and evolving into a multi-product company. JUMP provides the company with expansion in European markets and increases its capabilities through unit-linked funds functionality to serve European insurers which have assets in unit-linked funds. With JUMP, the company has additional capabilities providing a modular front, middle, and back office solution to investment managers, private banks, and insurers, which the company has grouped into the following offerings: Portfolio management and order management; Unit-linked funds; Tri-partite templates; and Full trade lifecycle.
The enhanced capabilities acquired from JUMP are complemented by the company’s add-on modules for Alternative Assets, Clearwater Prism, Multi-GAAP, and Self-Service.
Clearwater Wilshire Analytics
The company acquired Wilshire Technology in April 2024 to provide enhanced analytical capabilities for investment managers and institutional asset owners. The Clearwater Wilshire Analytics platform helps clients calculate performance and risk attribution, assist with security-level portfolio construction, uncover new strategies, access high-quality portfolio models, and identify investment opportunities that maximize returns and mitigate risk. As a result, investment teams are able to significantly improve client satisfaction and drive faster growth of assets under management compared to the market.
Clients
Clearwater serves a broad universe of institutional clients across multiple end-markets. The company’s largest client end-markets are asset management, insurance, and corporate treasury. The company is also growing its client base in the public sector with numerous state and local governments and government entities. While these end-markets and their clients can be quite different from each other, ultimately all of its clients need timely, accurate, and comprehensive information on their investments in order to effectively make capital allocation and portfolio decisions, manage risk, measure performance, comply with regulations, and communicate to various stakeholders both internally and externally. Chief Financial Officers, treasurers, controllers, and Chief Operating Officers select the company’s platform to deliver a holistic solution consisting of data aggregation, accounting book of record (ABOR), multi-basis reporting, powerful analytical tools, and other key features.
As of December 31, 2024, the company had over 1,400 clients across 49 countries with over $8.8 trillion of global invested assets on its platform. In addition, as of December 31, 2024, the company had 100 clients who contributed at least $1,000,000 in annualized recurring revenue. The company’s diversified, blue-chip client base of insurance companies, asset managers, and large corporations have $4.4 trillion, $2.7 trillion, and $1.1 trillion in assets on its platform, respectively, as of December 31, 2024. In addition, SLED (state, local, and education) entities, and bank/community foundations had $0.3 trillion and $0.2 trillion in assets on the company’s platform, as of December 31, 2024. The company’s top 10 clients represented less than 30% of total revenue for each of the year ended December 31, 2024.
Go-to-Market Strategy
The company seeks to deliver exceptional innovation and service to its clients every day. Client success is core to the company’s go-to-market approach and contributes to both its ability to win new clients and retain existing clients.
The company has earned an NPS of 60+ in an industry that typically scores much lower. The company’s high client satisfaction also translates into gross revenue retention rates of at least 98% in 23 of the past 24 quarters.
The company continued to see significant demand for its offerings around the world, and its sales efforts were supported by a sales force of 179 team members globally as of December 31, 2024. The company divides this sales force by geography, client end-market, and target client size. The company’s North American sales team includes representatives focused on insurance companies, asset managers, corporations, and growth markets. The company’s international sales team includes representatives focused on insurers and asset managers based in various regions of Europe and APAC. The company plans to continue expanding its sales force and adding new target end-markets in the periods ahead.
The company’s sales force is supported by a global marketing team with 23 team members as of December 31, 2024. The company actively grows its sales pipeline through account-based marketing, investment in its digital presence, increased brand awareness, and product marketing.
Growth Strategy
The company’s strategies are to deepen its relationships with existing clients, continue expanding within the company’s core client end-markets, accelerate international expansion, continue expanding within adjacent client end-markets, innovate and develop adjacent solutions, and pursue strategic partnerships and acquisitions.
Competition
The company’s principal competitors include large providers of investment operations, accounting, and analytics systems, such as SS&C (with its Advent, CAMRA, Maximus, and Singularity products), State Street (with its PAM and outsourced service offerings), SAP, BNY Mellon’s Eagle product, Deutsche Börse’s Simcorp Dimension, BlackRock’s Aladdin, FIS’s iWorks, and Northern Trust.
Intellectual Property and Proprietary Rights
The company has registered the marks ‘Clearwater’ and ‘Clearwater Prism,’ and two versions of Clearwater’s stylized logo with the U.S. Patent and Trademark Office and various international trademark offices.
In October 2022, the company was granted its first patent from the United States Patent Office (Patent No.: US 11,475,078 B2). The invention relates to identifying Application Programming Interface (‘API’) endpoints and the information required to use the endpoints in a software environment. By ‘crawling’ the environment, the invention can identify API functions and web services available in the environment.
History
Clearwater Analytics Holdings, Inc. was founded in 2004. The company was incorporated as a Delaware corporation in 2021.
